Dubberly Corporation's cost formula for its manufacturing overhead is $30,600 per month plus $64 per machine-hour. For the month of March, the company planned for activity of 7,900 machine-hours, but the actual level of activity was 7,880 machine-hours. The actual manufacturing overhead for the month was $558,610.The manufacturing overhead in the planning budget for March would be closest to:
A) $534,920
B) $558,610
C) $536,200
D) $560,028

Question

Quizplus · Accepted Answer

Using the cost formula given, we can calculate the manufacturing overhead in the planning budget for March as follows:

$30,600 + ($64 per machine-hour x 7,900 machine-hours planned) = $536,200

Therefore, choice C is the closest to the calculated amount.

Dubberly Corporation's Cost Formula for Its Manufacturing Overhead Is $30,600